The Passenger Train in the Motor Age - Synopsis

After the opening of Henry Ford's Highland Park factory in 1910, cheap and reliable automobiles challenged the the American passenger train for the loyalty of passengers between cities. The ninth title appearing in Ohio State University Press's Historical Perspectives on Business Enterprises Series, The Passenger Train in the Motor Age traces how management in two of the leading railroads in the United States searched for a new role for the American passenger train in the face of the automobile challenge.

In doing so, The Passenger Train in the Motor Age reveals a story of transportation modernization in the United States. Its carefully researched sources from regulatory commission case files of controversial railroad initiatives offer insight into why competition to railroads evolved, the nature of the competition, and how railroad managers perceived the competition through the filters of their managerial bureaucracies. Through this focus, the reader also learns how managers in competing industries perceived railroads. The reader thus gains a different perspective on railroad history compared to histories based primarily on sources from within the industry.

The book opens by examining the paradigm shift in U.S. transportation policy from the private provision of transportation infrastructure during the early twentieth century. It explains why after 1890 business groups turned their backs on railroad corporations in California, despite the success of railroad managements in bringing cheap transportation to the state. Increasingly after 1890 business groups nourished the growth of transportation competition by lobbying for government-provided harbors and roads. Particular attention is paid to the birth and phenomenonly rapid growth of the California highway burearcracy. This discussion lays the foundation for understanding first the renaissance of coastal steamship competition (which stole much of the freight and some of the passenger traffic from these two roads by 1920), followed by the rise of road competition. The early intercity bus industry is highlighted.

Based on research in case files of the Interstate Commerce Commission and California Railroad Commission, Thompson then examines the strucutre of railroad managements, the information and methods that managements used, and how managements evaluated results. He also evaluates the results with the benefit of hindsight. Because by the mid-1930s both railroads developed passenger train strategies that involved service and corporate integration with intercity bus companies, Thompson also offers insight into the intercity bus industry as both a competitor to and an ally of the railroad. Particular attention is paid to Pacific Greyhound Lines and, to a lesser extent, Santa Fe Trailways.

Thompson's conclusions are an important revision to business history and planning literature. He shows that management information systems obfuscated rather than enlightened management, that regulation played a relatively minor role in the decline, as did conspiracy between the rail and bus industries. A significant, potentially profitable niche remained for passenger trains in the 1930s, but railroad managements failed to exploit it primarily because of poor relations between them and their shippers stemming from the Progressive Era, as well as because of their misleading accounting systems. Rather than viewing passenger service as a significant source of profit, managers viewed it as a means of placating angry freight shippers while gaining competitive advantage over other railroads in the pursuit of freight traffic. This view led them to ignore important public preferences through the 1920s. In the early 1930s managements showed greater market sensitivity, but profitability continued to elude them, because they could not see the cost consequences of their passenger decisions. Essentially, faulty planning, blinded by the railroad business culture and by cost misunderstanding did the American passenger train in.

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